Pioneering tram scheme massively over budget

Published: July 14, 2017 Last modified: July 14, 2017

A pioneering project which could lead to trams running on railway lines across Britain has ended up costing five times more than planned and three years late because of mismanagement by Network Rail.

A scathing report by the National Audit Office says the project linking Sheffield and Rotherham using disused and freight-only railway tracks should have only cost £15m but has ended up costing £75m, while trams that should have started running in 2015 will not go into service until next year.

The privatised Stagecoach transport company is also being paid £2.5m by the taxpayer for loss of revenue as the trams are being left in sidings while the project is completed.

The scheme was originally approved by Liberal Democrat former transport minister Norman Baker and former chief secretary to the Treasury Danny Alexander in 2012. It was nearly cancelled twice by officials and ministers because of cost overruns and failure to anticipate basic problems, including the condition of the tracks it would use.

The government went ahead with the plan as it wants to see if existing rail lines could be used across the country to expand the tram network. There are plans to run tram services using old railway lines to link Glasgow city centre to the airport, along the Cardiff valleys in South Wales, and extending the Manchester tram system.

Clive Betts, Labour MP for Sheffield Attercliffe, who has taken a keen interest in the project, said: “The whole project was badly mismanaged by Network Rail. This idea has been developed in Germany for over 30 years but Network Rail never got in touch or visited German projects to see how they were run and they didn’t realise that you would need two different electric power systems to run trams on heavy rail lines and on the streets.

“I hope that the huge cost overruns don’t mean that other schemes will be dropped in the rest of the country. The two ministers who approved the project deserve credit for sticking with it despite the problems.”

The NAO report says the department of transport has still not evaluated whether the scheme is value for money or the extent to which it will reduce the costs of introducing similar schemes in other cities.

However initial plans costing some £144m are going ahead for a tram link using existing rail lines from Glasgow Queen Street to Paisley and a new tram spur to the airport.